SEBI Cracks Down on Fabricated Orders: KTL, ASL Under Investigation for Fraudulent Claims
Paytm Shares Fall 8% Amid ED Probe Over Crypto Scam


Last Updated: 24th January 2025 - 02:43 pm
On Friday, Paytm's share price tumbled more than 8% after reports surfaced that the company, along with seven other payment gateways, is under scrutiny by the Enforcement Directorate (ED) for alleged involvement in a cryptocurrency scam. The stock dipped by as much as 8.84%, reaching ₹773.90 per share on the BSE.
As of 10:40 AM IST, Paytm's stock was trading 2.28% lower at ₹829.60 per share on the BSE.
One 97 Communications, the parent firm of Paytm, is among the eight payment gateways under ED's investigation. According to a report by the Times of India (TOI), authorities have frozen approximately ₹500 crore in their virtual accounts over the past two years due to suspected links to the scam.
The probe is connected to a fraudulent cryptocurrency scheme allegedly run by 10 Chinese nationals through the HPZ Token app. The accused reportedly amassed over ₹2,200 crore from investors across 20 states by promoting cryptocurrency mining opportunities.
A significant portion of the collected funds was transferred overseas, while around ₹500 crore was frozen in the virtual accounts of the implicated payment gateways before it could reach the intended recipients. Investigators are tracing the financial transactions and assessing whether these gateways filed Suspicious Transaction Reports (STRs) as required and notified the Reserve Bank of India (RBI) and the Financial Intelligence Unit (FIU), as per financial compliance regulations.
Among the frozen amounts, PayU accounted for the highest sum at ₹130 crore, followed by Easebuzz with ₹33.4 crore, Razorpay at ₹18 crore, CashFree at ₹10.6 crore, and Paytm with ₹2.8 crore, as per the TOI report.
The scam was executed nationwide, with companies registered in at least 20 states, luring investors through the HPZ Token mobile application.
In a related case, a Prevention of Money Laundering Act (PMLA) court in Nagaland declared Delhi-based Bhupesh Arora a fugitive economic offender on January 22, as he failed to appear despite a non-bailable warrant. Arora reportedly fled to Dubai in 2022 after the ED began its investigation. The agency has filed a chargesheet naming 298 individuals in connection with the fraudulent scheme.
Over the past month, Paytm’s stock has dropped 16%, though it has gained more than 8% in the last three months. In the past six months, the stock has delivered an impressive 81% return. On a year-on-year basis, Paytm’s share price is up 10%, and over the past two years, it has gained more than 52%.
Paytm’s stock price partially rebounded after an initial drop of over 8% during trading on January 24, following reports of the Enforcement Directorate (ED) investigation.
Earlier, Paytm, along with payment gateways such as Razorpay, PayU, Easebuzz, and four others, were under scrutiny as the ED had frozen nearly ₹500 crore in their virtual accounts over the past two years. The probe is linked to Chinese nationals allegedly running a large-scale cryptocurrency scam in India through the HPZ Token platform.
Paytm’s Q3 Financial Performance
Meanwhile, One97 Communications, the parent company of Paytm, reported a reduced consolidated loss of ₹208.5 crore for the third quarter ending December 31, 2024. The improvement was mainly driven by cost reductions, particularly in payment processing and employee expenses. The company had recorded a higher loss of ₹221.7 crore in the same period the previous year.
Paytm’s revenue from operations dropped 35.8% year-on-year to ₹1,827.8 crore in the December 2024 quarter, compared to ₹2,850.5 crore in the same quarter a year earlier. The decline was attributed to lower revenues from its key business segments, including payments and financial services (down 34%), payment services (down 40%), and marketing services (down 48%).
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